Impact of the Getty Images v Stability AI Case on the Retail Sector

The much awaited Getty Images (“Getty”) v Stability AI trial took place at the end of June this year. Whilst it is difficult to predict what the decision of the case will be at this early stage, we can anticipate that there will be certain knock-on effects within the retail sector. To assist businesses with planning and to help navigate some of the commercial obstacles ahead, we have flagged certain areas within the retail industry which are likely to be impacted.

Increased costs of using AI generated materials for marketing, advertisements and designs

If the courts rule in Getty’s favour, AI software used by retailers either for product development, marketing content and advertisements may be required to seek licences in order to train their AI models. As a consequence, these costs may be passed on to retailers as they may be subject to higher fees for costs for using these AI tools.

Reduced ability to enforce your copyright protection

Should Stability AI successfully defend its position, that may give the greenlight to developers to freely train their AI models on third-party content- including your product images and descriptions. Retailers should use this as an opportunity to review their own website Terms & Conditions, particularly looking at clauses in relation to how their website content can be used and viewed by AI developers.

Review contracts with AI vendors

Retailers using AI for content or product design should revisit vendor contracts in light of the Getty case. If courts allow AI developers to train their models on copyrighted material, it will be crucial for retailers to revisit their contracts with third parties who offer or use AI, to ensure it is clear who owns the AI-generated content and who’s liable for any IP issues.

Reputational Risk for Brand-Led Retailers

For retailers who have authenticity, creativity or bespoke creation at the heart of their brand, the use of AI-generated content could backfire in the event Stability AI successfully defends its position. By way of example, if these businesses were found to make use of AI tools in the effort to be more efficient, but then inadvertently made use of third-party content, consumers may perceive the brand of “inauthentic” causing it reputational damage.

An increase in counterfeit goods and websites

If Stability AI successfully defends its position we may see an in increase in AI tools making use of website images, images of goods and product descriptions, making it even easier to develop competing websites and products. Some third parties may even go as far as to copy your website with a view to fraudulently misleading customers. Retailers may want to increase the use of domain name watch services anticipating a surge of this nature.

Cross border concerns

Stability AI argues its model was trained outside the UK, raising big questions about where copyright laws apply. The decision will also impact how different the UK’s copyright position is compared to that of the US and the EU when it comes to the training of AI models. For retailers that operate internationally and/or online, this could create uncertainty around which legal frameworks apply when using AI-generated content, complicating protection and enforcement strategies.

How can we help?

TLT has a dedicated team of specialists who can help you understand how the Getty Images v Stability AI Case will impact you. We can help you prepare by:

• Reviewing contracts with AI vendors to ensure appropriate IP protections are included;
• Reviewing and protecting your IP portfolio; and
• Defending your brand against IP claims.

For advice on how your company can prepare and to ensure you are ready for any legal or regulatory changes, contact our key IP experts below: